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Proposition 13 vs. Proposition 8, explained for California condo owners

By HiHolt · October 2026 · Laws and inflation factors checked October 13, 2026

Short answer: Proposition 13 sets your condo's taxable value at its market value when you bought it, usually the price you paid, and lets that value rise each year by California inflation, never more than 2%. Proposition 8 covers falling markets: each January 1, the taxable value is the lower of that Proposition 13 value and the condo's market value. A Proposition 8 value is temporary: as prices recover it can rise faster than 2% a year, but never above your Proposition 13 value.

Proposition 13: the value starts at what you paid

Under Proposition 13, approved by voters in June 1978, your condo's base year value is its market value when you bought it or when new construction was completed (California Constitution, article XIII A, §2(a); Revenue and Taxation Code §110.1). For an arm's-length purchase, the price paid is presumed to be the market value (R&T Code §110(b)). In the Los Angeles County Assessor's words, Proposition 13 "converted the market value-based property tax system to an acquisition value-based system."

A purchase also triggers a supplemental assessment (two, for a purchase between January 1 and May 31), based on the difference between the prior assessed value and the new one (R&T Code §75.10, §75.11).

The inflation factor: up to 2%, sometimes less

Each January 1 after the base year, the value is multiplied by an inflation factor: the October-to-October change in the California Consumer Price Index, capped at 2% (R&T Code §51(a)(1)). The State Board of Equalization (BOE) announces it.

  • 2026-27: 1.02, the 2% cap. No October 2025 index was issued because of the federal shutdown, so the BOE used August 2024 to August 2025, when the index rose 3.307% (BOE Letter To Assessors No. 2026/002).
  • Not always 2%. From 2010-11 through 2026-27 it was below 2% in 6 of 17 years, most recently 1.01036 for 2021-22; for 2010-11 it was 0.99763, a small decrease.

The base year value times every factor since is the factored base year value (the Los Angeles County Assessor says "trended base value"). We call it your "Prop 13 value"; the required notice below calls it the "Proposition 13 protected value".

Your tax is a 1% basic levy on the value on the assessment roll, plus taxes for voter-approved debt and any direct assessments, which vary by location (article XIII A, §1).

Proposition 8: the lower of two values on January 1

Proposition 8, passed in November 1978, allows temporary reductions when a property's value declines (BOE). For each January 1 lien date, the taxable value is the lesser of (1) the factored base year value and (2) the property's full cash value, meaning its market value, on that date (R&T Code §51(a); §2192). In Los Angeles County, a value lowered for January 1 applies to the fiscal year starting July 1.

Assessors monitor the market, and most also review a value at the owner's request (BOE). For how and when to ask in Los Angeles County, see How to file a decline-in-value review in Los Angeles County.

Temporary by design: yearly review and recapture

A reduced value must be reappraised at market value every January 1 until market value exceeds the factored base year value (R&T Code §51(e)). So:

  • It can rise more than 2% a year. Because a reduced value is reappraised at market value each year, it moves with the market and is not held to the 2% limit (BOE FAQ).
  • It never rises above your Prop 13 value without a change in ownership or new construction (BOE). The Prop 13 value keeps growing by the annual factor in the background, and the roll returns to it once the market catches up, often called "recapture" (the BOE's word is "restored").
Prop 13 value (factored base year value) Prop 8 value (market value)
What sets it Market value at purchase or new construction (usually the price paid), times each year's factor Your condo's market value on January 1
When it changes Every January 1, by the BOE factor; reset by a purchase or new construction Reappraised every January 1
Yearly cap 2%; less when California inflation is lower None, up or down, but never above the Prop 13 value
How long it lasts Until the next change in ownership or new construction Until market value reaches the Prop 13 value

A worked example (hypothetical numbers)

The prices here are invented. Only the inflation factors are real.

You bought a condo for $900,000, deed recorded in March 2019. For a purchase between January 1 and June 30, the first inflation adjustment comes the next January 1 (R&T Code §75.18). The BOE factors for 2020 through 2026 were 2% except in 2021 (1.036%), so your 2026 Prop 13 value is about $1,024,000.

The taxable value each year is the lower of the two values.

Jan. 1 Prop 13 value Market value (hypothetical) Taxable value
2026 about $1,024,000 $700,000 $700,000
2027 up to about $1,044,500* $800,000 $800,000 (up 14%)
2028 up to about $1,065,400* $1,100,000 the Prop 13 value

*Assumes the 2% maximum for 2027 and 2028; those factors are not yet announced.

For 2026-27, the roll value is $700,000 instead of about $1,024,000. In 2027 the taxable value rises 14% with the market, which is allowed for a reduced value. In 2028 it stops at the Prop 13 value, not $1,100,000, and the 2% limit applies again.

Why two identical condos can owe very different taxes

Identical units are bought in different years at different prices, so each has its own Prop 13 value. Suppose your neighbor bought the same floor plan next door for $450,000, deed recorded in March 2012 (also hypothetical). With the same BOE factors, their 2026 Prop 13 value is about $576,500, below the $700,000 market value, so that is their taxable value.

You are taxed on about $1,024,000, or on $700,000 if a Proposition 8 value is enrolled. Either way you pay more, because Proposition 8 lowers a value to market value, never below it.

FAQ

Why do I pay more property tax than my neighbor with the same condo? Assessed value follows each owner's purchase price and date, not the unit. A neighbor who paid less has a lower Prop 13 value, and Proposition 8 can lower yours only to market value.

Can my assessed value go up more than 2% in a year? Yes, for example after a purchase or new construction, or when a Prop 8 value rises with the market. A Prop 8 value still cannot pass your factored base year value.

Does a Prop 8 reduction last forever? No. It is reappraised every January 1 and ends when market value reaches your Prop 13 value.

What was California's inflation factor for 2026? 1.02 (2%), for the January 1, 2026 lien date.

Can I get a Prop 8 reduction for past years? No. Only the most recent January 1 assessment can be reviewed, and Proposition 8 does not apply to supplemental assessments (BOE FAQ).

About HiHolt

This paragraph describes our own paid service. HiHolt prepares and files Proposition 8 decline-in-value reviews for California condo owners who sign a written authorization. Downtown Los Angeles condos are checked online right away; other California condos on request. The fee is 30% of the property tax actually saved for that year. Nothing is charged before filing, HiHolt pays Los Angeles County's $46 appeal fee, and you pay only if your tax goes down. HiHolt is a brand of Fortunewoods LLC, a private company. Its filings are made under Los Angeles County Tax Agent Registration Number AG00000-1565.

Required notice

This service is not associated with any government agency. An informal assessment review by the Assessor is free of charge, and you can file an Application for Changed Assessment with the Assessment Appeals Board on your own behalf. The appeals board also has the authority to raise property values, but in no case higher than the Proposition 13 protected value.

Laws, BOE inflation factors and County pages checked October 13, 2026. The worked examples use hypothetical prices; only the inflation factors are real. This article explains general rules and is not legal or tax advice.

Sources (all checked October 13, 2026):